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Despite the pay raise, Price is a great bargain for the Rays.
This $10.1 million arbitration settlement is a bittersweet feat for Tampa Bay Rays general manager Andrew Friedman.
On a positive note, it pleases the reigning AL Cy Young Award winner. David Price will make considerably more than the $9.5 million Matt Swartz of MLB Trade Rumors projected.
Moreover, as Jon Paul Morosi of Fox Sports details, the two sides reached an agreement in late December. The Rays immediately paid David Price a $5 million signing bonus, which counts as 2012 income. That money, therefore, is not affected by the newly raised top federal income tax rate.
Morosi explains the flip side:
There also was a clever wrinkle in this deal for the Rays: the $4 million in 2013 salary that will be deferred until 2014.
Price is one of the best pitchers in baseball, but with each passing day it becomes less likely that the low-budget Rays will be able to sign him to a long-term extension...the franchise’s financial model doesn’t seem to permit carrying expensive starting pitchers.
Any exchange would net a handful of impact players capable of keeping Tampa Bay in contention for years to come. The buying team would also be on the hook for that deferred sum if Price finds a new home later this year.
For now, though, he's with the Rays and making much less than other elite MLB starters.